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Opponents of the free market approach assert that the free market... 03 Jun 2019, 03:57
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C
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!

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46% (02:01) correct 54% (02:12) wrong based on 689 sessions

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Opponents of the free market approach assert that the free market often fails to achieve maximum efficiency—that it sometimes wastes resources. They often cite the example of utility services. If there were free competition among utilities, it would lead to a lot of duplication—different companies putting up telephone and electric poles, waterlines, etc., side by side, which would be a waste. So they argue that it is important for government to restrict competition and thus correct market failures.

The answer to which of the following questions would help evaluate whether the opponents of the free market theory are correct?

(A) Whether it is possible to procure items such as electric and telephone poles used by utility services at low prices
(B) Whether there is some other feasible way of solving the problem of duplication mentioned in the argument
(C) Whether following this strategy is likely to lead to formation of monopolies that can be used to exploit consumers
(D) Whether the free market is likely to have any detrimental effect on the economy of the country
(E) Whether the free market approach has been adopted by any other countries in the world
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C
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Opponents of the free market approach assert that the free market... 04 Jun 2019, 06:21
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Quote:
Opponents of the free market approach assert that the free market often fails to achieve maximum efficiency—that it sometimes wastes resources. They often cite the example of utility services. If there were free competition among utilities, it would lead to a lot of duplication—different companies putting up telephone and electric poles, waterlines, etc., side by side, which would be a waste. So they argue that it is important for government to restrict competition and thus correct market failures.

The answer to which of the following questions would help evaluate whether the opponents of the free market theory are correct?

(A) Whether it is possible to procure items such as electric and telephone poles used by utility services at low prices
(B) Whether there is some other feasible way of solving the problem of duplication mentioned in the argument
(C) Whether following this strategy is likely to lead to formation of monopolies that can be used to exploit consumers
(D) Whether the free market is likely to have any detrimental effect on the economy of the country
(E) Whether the free market approach has been adopted by any other countries in the world
Show more

The right answer to this question is C. The biggest challenge this question actually poses is in identifying the conclusion of the argument. This alone turns the question from being actually fairly straightforward into a nightmarishly hard one.
The conclusion of the argument here is that "it is important for government to restrict competition and thus correct market failures". Since this is an 'evaluate' question, we're looking for an option that, if answered one way, supports this conclusion and if answered the other way, hurts the conclusion.

A - The problem that the government solves, according to the argument, is one of duplication. Whether the capital costs of electric/phone poles are high or low, the duplication problem will still exist in some form. Hence, the conclusion is supported by A no matter what. OUT

B - This is the trap answer! If there is no feasible way, the conclusion obviously holds true. But even if there is another way, it doesn't change the fact that this method would still work/be important. Analogy: Just because a "better" GMAT score of 770 exists, it doesn't make a score of 720 a bad one. OUT

C - If the answer to this question is no, the conclusion holds true. If the answer is yes, however, the conclusion suddenly falls apart. Hence, this is exactly the piece of info that we need in order to tell us if the conclusion is sound or not, i.e. evaluate the conclusion. Hence, this option is CORRECT.

D - Whether the free market has a detrimental effect or not is irrelevant to this argument. We are trying to evaluate whether it is important for the government to play a role, not the market itself. OUT

E - This is super irrelevant. Whether countries adopt an approach or not tells us nothing about whether that approach is good/necessary. In addition, this option isn't even looking at the relevant approach discussed in the conclusion. OUT

One of the key takeaways here is that for any assumption related questions (Find the assumption, Strengthen/Weaken the argument, Evaluate the argument), the first key obstacle you have to overcome is to correctly identify the claim being made in the conclusion.

- Matoo
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Opponents of the free market approach assert that the free market... 03 Nov 2020, 23:44
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Quote:
Opponents of the free market approach assert that the free market often fails to achieve maximum efficiency—that it sometimes wastes resources. They often cite the example of utility services. If there were free competition among utilities, it would lead to a lot of duplication—different companies putting up telephone and electric poles, waterlines, etc., side by side, which would be a waste. So they argue that it is important for government to restrict competition and thus correct market failures.

The answer to which of the following questions would help evaluate whether the opponents of the free market theory are correct?

(A) Whether it is possible to procure items such as electric and telephone poles used by utility services at low prices
(B) Whether there is some other feasible way of solving the problem of duplication mentioned in the argument
(C) Whether following this strategy is likely to lead to formation of monopolies that can be used to exploit consumers
(D) Whether the free market is likely to have any detrimental effect on the economy of the country
(E) Whether the free market approach has been adopted by any other countries in the world

The right answer to this question is C. The biggest challenge this question actually poses is in identifying the conclusion of the argument. This alone turns the question from being actually fairly straightforward into a nightmarishly hard one.
The conclusion of the argument here is that "it is important for government to restrict competition and thus correct market failures". Since this is an 'evaluate' question, we're looking for an option that, if answered one way, supports this conclusion and if answered the other way, hurts the conclusion.

A - The problem that the government solves, according to the argument, is one of duplication. Whether the capital costs of electric/phone poles are high or low, the duplication problem will still exist in some form. Hence, the conclusion is supported by A no matter what. OUT

B - This is the trap answer! If there is no feasible way, the conclusion obviously holds true. But even if there is another way, it doesn't change the fact that this method would still work/be important. Analogy: Just because a "better" GMAT score of 770 exists, it doesn't make a score of 720 a bad one. OUT

C - If the answer to this question is no, the conclusion holds true. If the answer is yes, however, the conclusion suddenly falls apart. Hence, this is exactly the piece of info that we need in order to tell us if the conclusion is sound or not, i.e. evaluate the conclusion. Hence, this option is CORRECT.

D - Whether the free market has a detrimental effect or not is irrelevant to this argument. We are trying to evaluate whether it is important for the government to play a role, not the market itself. OUT

E - This is super irrelevant. Whether countries adopt an approach or not tells us nothing about whether that approach is good/necessary. In addition, this option isn't even looking at the relevant approach discussed in the conclusion. OUT

One of the key takeaways here is that for any assumption related questions (Find the assumption, Strengthen/Weaken the argument, Evaluate the argument), the first key obstacle you have to overcome is to correctly identify the claim being made in the conclusion.

- Matoo
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Can you elaborate the explanation on option B and C a little more?

Thank you.
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Opponents of the free market approach assert that the free market... 04 Nov 2020, 08:44
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I chose B since duplication is the bone of contention for opponents. Seriously guys, these explanations are way beyond my understanding. I would rather practice using GMAT official guide.

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Opponents of the free market approach assert that the free market... 25 Nov 2020, 05:00
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dcummins
Opponents of the free market approach assert that the free market often fails to achieve maximum efficiency—that it sometimes wastes resources. They often cite the example of utility services. If there were free competition among utilities, it would lead to a lot of duplication—different companies putting up telephone and electric poles, waterlines, etc., side by side, which would be a waste. So they argue that it is important for government to restrict competition and thus correct market failures.

The answer to which of the following questions would help evaluate whether the opponents of the free market theory are correct?

(A) Whether it is possible to procure items such as electric and telephone poles used by utility services at low prices
(B) Whether there is some other feasible way of solving the problem of duplication mentioned in the argument
(C) Whether following this strategy is likely to lead to formation of monopolies that can be used to exploit consumers
(D) Whether the free market is likely to have any detrimental effect on the economy of the country
(E) Whether the free market approach has been adopted by any other countries in the world
Show more

Official Explanation



Answer: C

The argument is assuming that there will be no negative aspects of restricting competition. But what if restricting competition gave rise to monopolies? Then there could be negative consequences of this move. C addresses this point and is the correct answer.

(A) Even if these items can be procured at low prices, why spend money on duplication?

(B) We are only concerned about the method described in the argument; any other methods are outside the scope.

(C) The correct answer.

(D) Even if the free market does not have a detrimental effect on the economy of a country, it does not necessarily mean that it will have a beneficial effect either.

(E) What has happened in other countries is outside the scope of the argument.
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Opponents of the free market approach assert that the free market... 25 Nov 2020, 11:08
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YASH750
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Opponents of the free market approach assert that the free market often fails to achieve maximum efficiency—that it sometimes wastes resources. They often cite the example of utility services. If there were free competition among utilities, it would lead to a lot of duplication—different companies putting up telephone and electric poles, waterlines, etc., side by side, which would be a waste. So they argue that it is important for government to restrict competition and thus correct market failures.

The answer to which of the following questions would help evaluate whether the opponents of the free market theory are correct?

(A) Whether it is possible to procure items such as electric and telephone poles used by utility services at low prices
(B) Whether there is some other feasible way of solving the problem of duplication mentioned in the argument
(C) Whether following this strategy is likely to lead to formation of monopolies that can be used to exploit consumers
(D) Whether the free market is likely to have any detrimental effect on the economy of the country
(E) Whether the free market approach has been adopted by any other countries in the world

The right answer to this question is C. The biggest challenge this question actually poses is in identifying the conclusion of the argument. This alone turns the question from being actually fairly straightforward into a nightmarishly hard one.
The conclusion of the argument here is that "it is important for government to restrict competition and thus correct market failures". Since this is an 'evaluate' question, we're looking for an option that, if answered one way, supports this conclusion and if answered the other way, hurts the conclusion.

A - The problem that the government solves, according to the argument, is one of duplication. Whether the capital costs of electric/phone poles are high or low, the duplication problem will still exist in some form. Hence, the conclusion is supported by A no matter what. OUT

B - This is the trap answer! If there is no feasible way, the conclusion obviously holds true. But even if there is another way, it doesn't change the fact that this method would still work/be important. Analogy: Just because a "better" GMAT score of 770 exists, it doesn't make a score of 720 a bad one. OUT

C - If the answer to this question is no, the conclusion holds true. If the answer is yes, however, the conclusion suddenly falls apart. Hence, this is exactly the piece of info that we need in order to tell us if the conclusion is sound or not, i.e. evaluate the conclusion. Hence, this option is CORRECT.

D - Whether the free market has a detrimental effect or not is irrelevant to this argument. We are trying to evaluate whether it is important for the government to play a role, not the market itself. OUT

E - This is super irrelevant. Whether countries adopt an approach or not tells us nothing about whether that approach is good/necessary. In addition, this option isn't even looking at the relevant approach discussed in the conclusion. OUT

One of the key takeaways here is that for any assumption related questions (Find the assumption, Strengthen/Weaken the argument, Evaluate the argument), the first key obstacle you have to overcome is to correctly identify the claim being made in the conclusion.

- Matoo

Can you elaborate the explanation on option B and C a little more?

Thank you.
Show more
YASH750
(B) Whether there is some other feasible way of solving the problem of duplication mentioned in the argument
If answer is YES, then what. Isn't the conclusion still holding? It may or may not hold depending on the argument. More importantly any method of solving the problem of duplication is hardly of any help. Also, the problem cited here is just an example which is used to make a conclusion. So, any choice targeting the example has a narrow scope.

(C) Whether following this strategy is likely to lead to formation of monopolies that can be used to exploit consumers
Let's say the govt. restricts competition. If monopolies form, then there would not be any such problem and free market works - conclusion still holds. On the other hand, if restricting competition does not lead to monopolies, then many companies still exists, thus free market not working at max. efficiency. Hence the conclusion falls apart i.e. Opponents of free market are wrong to conclude or say that.

HTH.
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Opponents of the free market approach assert that the free market... 20 Dec 2021, 06:28
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I think C can't be correct.

The argument is

competition => wastage of resources

So

Government should restrict competition

If there is other way to reduce wastage then there is no need to restrict competition.

Which is B. Monopoly is out of question.

correct me if I am wrong.
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Opponents of the free market approach assert that the free market... 09 Oct 2024, 23:39
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